Employee Benefit Costs | Employee Benefit Costs: Retirement Plan and Other Postretirement Benefits The Company has noncontributory, defined benefit retirement plans and other postretirement benefit plans covering certain employees. In October 2012, the Board of Directors of the Company authorized an amendment to the Company's defined benefit retirement plans for U.S. non-bargaining employees. The amendment freezes accruals for all non-bargaining employees within the pension plan effective December 31, 2013. The Company uses a June 30 measurement date for all of its plans. The following provides a reconciliation of obligations, plan assets and funded status of the plans for the two years indicated (in thousands): Pension Benefits Other Postretirement Benefits Actuarial Assumptions: 2019 2018 2019 2018 Discounted Rate Used to Determine Present Value of Projected Benefit Obligation 3.60 % 4.30 % 3.55 % 4.25 % Weighted Average Expected Long-Term Rate of Return on Plan Assets 6.90 % 7.00 % n/a n/a Change in Benefit Obligations: Projected Benefit Obligation at Beginning of Year $ 959,010 $ 1,116,705 $ 58,801 $ 66,693 Service Cost 4,541 2,402 106 135 Interest Cost 39,720 43,068 2,332 2,372 Plan Settlements (1,720 ) (101,553 ) — — Plan Participant Contributions — — 2,212 2,346 Actuarial (Gain) Loss 59,362 (27,541 ) 1,364 (146 ) Benefits Paid (63,228 ) (74,071 ) (10,815 ) (12,599 ) Projected Benefit Obligation at End of Year $ 997,685 $ 959,010 $ 54,000 $ 58,801 Change in Plan Assets: Fair Value of Plan Assets at Beginning of Year $ 765,644 $ 870,606 $ — $ — Actual Return on Plan Assets 68,745 36,914 — — Plan Participant Contributions — — 2,212 2,346 Employer Contributions 3,734 33,748 8,603 10,253 Benefits Paid (63,228 ) (74,071 ) (10,815 ) (12,599 ) Plan Settlements (1,720 ) (101,553 ) — — Fair Value of Plan Assets at End of Year $ 773,175 $ 765,644 $ — $ — Funded Status: Plan Assets (Less Than) in Excess of Projected Benefit Obligation $ (224,510 ) $ (193,366 ) $ (54,000 ) $ (58,801 ) Amounts Recognized on the Balance Sheets: Accrued Pension Cost $ (221,033 ) $ (189,872 ) $ — $ — Accrued Wages and Salaries (3,477 ) (3,494 ) — — Accrued Postretirement Health Care Obligation — — (25,929 ) (30,186 ) Accrued Liabilities — — (6,760 ) (8,418 ) Accrued Employee Benefits — — (21,311 ) (20,197 ) Net Amount Recognized at End of Year $ (224,510 ) $ (193,366 ) $ (54,000 ) $ (58,801 ) Amounts Recognized in Accumulated Other Comprehensive Income (Loss), Net of Tax: Net Actuarial Loss $ (242,565 ) $ (218,066 ) $ (10,571 ) $ (11,815 ) Prior Service Credit (Cost) (3 ) (125 ) — 433 Net Amount Recognized at End of Year $ (242,568 ) $ (218,191 ) $ (10,571 ) $ (11,382 ) The accumulated benefit obligation for all defined benefit pension plans was $998 million and $959 million at June 30, 2019 and July 1, 2018 , respectively. The Company recognizes the funded status of its pension plan in the Consolidated Balance Sheets. The funded status is the difference between the projected benefit obligation and the fair value of its plan assets. The projected benefit obligation is the actuarial present value of all benefits expected to be earned by the employees’ service adjusted for future potential wage increases. Pension plan liabilities are revalued annually, or when an event occurs that requires remeasurement, based on updated assumptions and information about the individuals covered by the plan. The pension benefit obligation and related pension expense or income are impacted by certain actuarial assumptions, including the discount rate, mortality tables, and the expected rate of return on plan assets. The discount rate is selected using a methodology that matches plan cash flows with a selection of Standard and Poor’s AA or higher rated bonds, resulting in a discount rate that is consistent with a bond yield curve with comparable cash flows. In estimating the expected return on plan assets, the Company considers the historical returns on plan assets, adjusted for forward looking considerations, including inflation assumptions and active management of the plan’s invested assets. These rates are evaluated on an annual basis considering such factors as market interest rates and historical asset performance. For pension and other postretirement plans, accumulated actuarial gains and losses in excess of a 10 percent corridor are amortized on a straight-line basis from the date recognized over the average remaining life expectancy of all participants. Any prior service costs are amortized on a straight-line basis over the average remaining service of impacted employees at the time the unrecognized prior service cost was established. Approximately half of the costs related to defined pension benefit and other postretirement plans are included in cost of sales; the remainder is included in selling, general and administrative expenses. The following table summarizes the plans’ income and expense for the three years indicated (in thousands): Pension Benefits Other Postretirement Benefits 2019 2018 2017 2019 2018 2017 Components of Net Periodic (Income) Expense: Service Cost-Benefits Earned During the Year $ 4,541 $ 2,402 $ 6,757 $ 106 $ 135 $ 191 Interest Cost on Projected Benefit Obligation 39,720 43,068 43,357 2,332 2,372 2,382 Expected Return on Plan Assets (54,327 ) (61,912 ) (64,427 ) — — — Amortization of: Prior Service Cost (Credit) 179 179 180 (729 ) (1,434 ) (2,654 ) Actuarial Loss 11,638 15,332 16,957 3,159 3,453 2,796 Plan Settlements 521 41,157 — — — — Net Periodic Expense $ 2,272 $ 40,226 $ 2,824 $ 4,868 $ 4,526 $ 2,715 Significant assumptions used in determining net periodic expense for the fiscal years indicated are as follows: Pension Benefits Other Postretirement Benefits 2019 2018 2017 2019 2018 2017 Discount Rate 4.30% 4.00% 3.75% 4.25% 3.85% 3.60% Expected Return on Plan Assets 7.05% 7.10% 7.25% n/a n/a n/a Compensation Increase Rate n/a n/a n/a n/a n/a n/a The amounts in Accumulated Other Comprehensive Income (Loss) that are expected to be recognized as components of net periodic (income) expense during the next fiscal year are as follows (in thousands): Pension Plans Other Postretirement Plans Prior Service Cost (Credit) $ (78 ) $ — Net Actuarial Loss (15,904 ) (2,998 ) The “Other Postretirement Benefit” plans are unfunded. For measurement purposes a 5.8% annual rate of increase in the per capita cost of covered health care claims was assumed for the Company for fiscal year 2019 decreasing gradually to 4.5% for the fiscal year 2038 . The health care cost trend rate assumptions have a significant effect on the amounts reported. An increase of one percentage point would increase the accumulated postretirement benefit by $0.8 million and would increase the service and interest cost by $41 thousand for fiscal 2019 . A corresponding decrease of one percentage point would decrease the accumulated postretirement benefit by $0.8 million and decrease the service and interest cost by $46 thousand for the fiscal year 2019 . During the fourth quarter of fiscal 2018, the Company annuitized a portion of the qualified pension plan obligation which removed approximately $100 million of pension benefit obligation and offsetting assets. This transaction resulted in a non-cash pre-tax charge of $41.2 million ( $29.6 million after tax) during 2018. Plan Assets A Board of Directors appointed Investment Committee (“Committee”) manages the investment of the pension plan assets. The Committee has established and operates under an Investment Policy. It determines the asset allocation and target ranges based upon periodic asset/liability studies and capital market projections. The Committee retains external investment managers to invest the assets. The Investment Policy prohibits certain investment transactions, such as lettered stock, commodity contracts, margin transactions and short selling, unless the Committee gives prior approval. The Company’s pension plan’s current target and asset allocations at June 30, 2019 and July 1, 2018 , by asset category are as follows: Plan Assets at Year-end Asset Category Target % 2019 2018 Domestic Equities 14%-25% 19% 24% International Equities 14%-26% 19% 16% Global Equities 2%-8% 5% —% Hedge Funds 2%-8% 4% —% Alternatives 3%-9% 6% 7% Fixed Income 37%-53% 45% 51% Cash Equivalents 0%-3% 2% 2% 100% 100% The plan’s investment strategy is based on an expectation that, over time, equity securities will provide higher total returns than debt securities, but with greater risk. The plan primarily minimizes the risk of large losses through diversification of investments by asset class, by investing in different types of styles within the classes, using a number of different managers, and by structuring a dedicated fixed income allocation to better match future cash flows from plan assets with the future cash flows of the projected benefit obligation. The Committee monitors the asset allocation and investment performance monthly, with a more comprehensive quarterly review with its investment advisor. The plan’s expected return on assets is based on management’s and the Committee’s expectations of long-term average rates of return to be achieved by the plan’s investments. These expectations are based on the plan’s historical returns and expected returns for the asset classes in which the plan is invested. The Company has adopted the fair value provisions for the plan assets of its pension plans. The Company categorizes plan assets within a three level fair value hierarchy, as described in Note 6 . Investments stated at fair value as determined by quoted market prices (Level 1) include: Short-Term Investments: Short-Term Investments include cash and money market mutual funds that invest in short-term securities and are valued based on cost, which approximates fair value. Equity Securities: U.S. Common Stocks and International Mutual Funds are valued at the last reported sales price on the last business day of the fiscal year. Investments stated at estimated fair value using significant observable inputs (Level 2) include: Fixed Income Securities: Fixed Income Securities include investments in domestic bond collective trusts that are not traded publicly, but the underlying assets held in these funds are traded on active markets and the prices are readily observable. The investment in the trusts is valued at the last quoted price on the last business day of the fiscal year. Fixed Income Securities also include corporate and government bonds that are valued using a bid evaluation process with data provided by independent pricing sources. Investments stated at estimated fair value using net asset value per share as the practical expedient include: Other Investments: Other Investments include investments in limited partnerships and are valued at estimated fair value, as determined with the assistance of each respective limited partnership, based on the net asset value of the investment as of the balance sheet date, which is subject to judgment. The fair value of the major categories of the pension plans’ investments are presented below (in thousands): June 30, 2019 Category Total Level 1 Level 2 NAV Short-Term Investments: $ 11,982 $ 11,982 $ — $ — Fixed Income Securities: 351,029 — 283,392 67,637 Equity Securities: U.S. common stocks 148,967 50,919 — 98,048 International mutual funds 149,899 — — 149,899 Global equities 36,491 — — 36,491 Other Investments: Venture capital funds (A) 20,633 — — 20,633 Hedge funds 32,698 — — 32,698 Debt funds (B) 1,777 — — 1,777 Real estate funds (C) 770 — — 770 Private equity funds (D) 18,929 — — 18,929 Fair Value of Plan Assets at End of Year $ 773,175 $ 62,901 $ 283,392 $ 426,882 July 1, 2018 Category Total Level 1 Level 2 NAV Short-Term Investments: $ 17,061 $ 17,061 $ — $ — Fixed Income Securities: 394,188 — 394,188 — Equity Securities: U.S. common stocks 183,030 183,030 — — International mutual funds 118,674 118,674 — — Other Investments: Venture capital funds (A) 26,078 — — 26,078 Debt funds (B) 2,778 — — 2,778 Real estate funds (C) 1,166 — — 1,166 Private equity funds (D) 22,656 — — 22,656 Fair Value of Plan Assets at End of Year $ 765,631 $ 318,765 $ 394,188 $ 52,678 (A) This category invests in a combination of public and private securities of companies in financial distress, spin-offs, or new projects focused on technology and manufacturing. (B) This fund primarily invests in the debt of various entities including corporations and governments in emerging markets, mezzanine financing, or entities that are undergoing, are considered likely to undergo or have undergone a reorganization. (C) This category invests primarily in real estate related investments, including real estate properties, securities of real estate companies and other companies with significant real estate assets as well as real estate related debt and equity securities. (D) Primarily represents investments in all sizes of mostly privately held operating companies in the following core industry sectors: healthcare, energy, financial services, technology-media-telecommunications and industrial and consumer. Contributions During fiscal 2019, the Company made no voluntary cash contributions to the qualified pension plan. Based upon current regulations and actuarial studies the Company is required to make no minimum contributions to the qualified pension plan in fiscal 2020, but the Company may choose to make discretionary contributions. The Company may be required to make further required contributions in future years or the future expected funding requirements may change depending on a variety of factors including the actual return on plan assets, the funded status of the plan in future periods, and changes in actuarial assumptions or regulations. Estimated Future Benefit Payments Projected benefit payments from the plans as of June 30, 2019 are estimated as follows (in thousands): Pension Benefits Other Postretirement Benefits Year Ending Qualified Non-Qualified Retiree Medical Retiree Life 2020 $ 63,368 $ 3,477 $ 5,335 $ 1,425 2021 63,435 3,512 4,236 1,432 2022 63,128 3,586 3,632 1,437 2023 62,664 3,619 3,130 1,437 2024 62,042 3,653 2,605 1,435 2024-2028 293,444 18,316 7,897 7,004 Defined Contribution Plans Employees of the Company may participate in a defined contribution savings plan that allows participants to contribute a portion of their earnings in accordance with plan specifications. A maximum of 1.5% to 4.0% of each participant’s salary, depending upon the participant’s group, is matched by the Company. Additionally, all domestic non-bargaining employees receive a Company non-elective contribution of 3.0% of the employee’s pay. The Company contributions totaled $14.9 million in fiscal year 2019 and $14.5 million in 2018 and 2017 , respectively. Postemployment Benefits The Company accrues the expected cost of postemployment benefits over the years that the employees render service. These benefits apply only to employees who become disabled while actively employed, or who terminate with at least thirty years of service and retire prior to age sixty-five. The items include disability payments, life insurance and medical benefits. These amounts were discounted using a 3.55% interest rate for fiscal 2019 and 4.25% interest rate for fiscal 2018 . Amounts are included in Accrued Employee Benefits in the Consolidated Balance Sheets. |